Directors face drilling grilling

By CHRIS DANIELS energy writer

New Zealand Oil and Gas directors got a roasting from some frustrated shareholders yesterday, upset at what they say is a lack of exploration activity.

At the annual meeting in Auckland, chairman Tony Radford was asked why drilling in Taranaki that shareholders were told last year was due to take place, had still not been done.

Wells were to have been drilled into NZOG's potentially lucrative Tui site, off Taranaki.

Mr Radford said there had been problems getting a suitable drilling rig into New Zealand waters. It also wanted to get more joint-venture partners to help share the cost.

Despite this delay at sea, drilling would begin soon on land in Taranaki, near NZOG's existing oil wells at Ngatoro, near Inglewood, said Mr Radford.

More exploration would start soon further up the Taranaki coast at Opito, he said.

Several people who own options to buy NZOG shares next year were at yesterday's meeting, some of them angry at what they saw as broken promises to explore during the past year.

"I don't know what to believe now," said one, when told of the reasons there had been no drilling this year as expected.

In other business discussed yesterday, plans were revealed by NZOG directors to give every shareholder one share in its Australian subsidiary Pan Pacific Petroleum for each NZOG share they own.

Pan Pacific explores for oil and gas off the western coast of Australia and is listed on the Australian Stock Exchange.

Separating the ownership of the two companies would allow NZOG to spend its money on its own activities, without restricting Pan Pacific from raising new equity capital.

A special shareholders' meeting will be held on December 14 to vote on this proposal.